Biden's Take on Opportunity ZonesNov 24, 2020
"Opportunity Zones" were part of a nationwide policy implemented back in December 2017 under Trump's Tax Cuts and Jobs Act. The goal was to stimulate economic development by targeting distressed communities across the U.S. The policy was first presented in a report back in 2015 by Jared Bernstein and later lumped into Trumps tax cuts via a modified bill from Republican Senator Tim Scott.
The concept of OZ's were that if investors were given a series of tax breaks in particular areas, they'd have incentive to pour investment dollars into areas that need it most.
"The benefits are generous. First, investors get to defer paying capital gains taxes for years if they sell appreciated investments and roll the proceeds into a fund targeting zones. But the real sweetener comes later: A business or real estate project held by a fund at least a decade isn’t subject to capital gains when sold." - Financial Advisor
From what we can tell, Joe Biden's team sees the potential in Opportunity Zones. One of Biden's top economic advisers co-wrote the white paper that led to their creation, and Vice President elect, Kamala Harris, has also hinted that these zones could be a way to foster entrepreneurship.
"There are a lot of people in his universe who care about this. They think it's a good idea." - Steve Glickman, former Obama administration official
According to the article by Financial Advisor, the core of Biden's plan is to build transparency within Opportunity Zones to ensure that projects are creating social benefits as intended. "His “Build Back Better” racial equity-focused campaign plan called for directing Treasury to review the policy to ensure projects create social benefits. It also would require tax-break users to “provide detailed reporting and public disclosure” of investments."